London Stocks Seen Opening Lower
The FTSE 100 index is expected to open around 50 points lower, according to IG, having closed Monday at 7255.46, following losses in many Asian markets. The renomination of Jerome Powell as Federal Reserve chairman was widely expected but could justify markets pricing in interest-rate rises next year, analysts say. Concerns about rising Covid-19 cases in Europe also linger. Individual stocks in focus include water company Severn Trent, which swung to a loss in 1H; catering contractor Compass Group after it reported a rise in full-year pretax profit and reinstated dividends; and Irish building-materials supplier CRH after a trading update. U.K. and eurozone provisional purchasing managers' surveys for November will be watched, with the U.K. numbers due at 0930 GMT.
Severn Trent Swung to 1H Loss on Deferred Tax Charge
Severn Trent PLC on Tuesday reported a net loss for the first half of the fiscal year, but said its underlying performance improved.
River & Mercantile Gets Bid Approaches from Premier Miton, AssetCo
River & Mercantile Group PLC said Tuesday that it has received preliminary takeover approaches from Premier Miton Group PLC and AssetCo PLC, with any potential offers conditional upon the company's sale of sale of its solutions business.
AO World Slashes FY 2022 Guidance as Peak Period Turns Out Softer Than Expected
AO World PLC on Tuesday cut full-year financial guidance and warned that the current peak trading period is significantly softer than anticipated.
Compass Group FY 2021 Pretax Profit Rose; Reinstates Dividends
Compass Group PLC on Tuesday reported a increase in pretax profit for fiscal 2021 as it booked lower costs and returned to the dividend list.
Reach Revenue Above FY Expectations
Reach PLC said Tuesday its revenue is currently above full-year expectations, with customer registrations having increased since the end of July.
Polyus 3Q Profit Rose, Driven by Higher Gold Production
Polyus PJSC on Tuesday reported an improved profit for the third quarter, as production rose well above the immediately prior period.
BHP Not Granted Tax Relief for Woodside Energy Deal
The demerger of BHP's oil-and-gas business, which will be combined with Australia's Woodside, hasn't been granted relief by the Australian Taxation Office and will be considered a taxable event, RBC Capital Markets notes. "However, the new WPL shares will be distributed to BHP shareholders as an in-specie fully franked dividend," RBC says. The circa US$15B distribution, based on the current share price, will have a roughly US$6B or A$1.60/share franking credit attached, so will most likely favor low-tax rate entities such as super funds, the broker says. "The cost base of the issued WPL shares will also be higher relative to a pro-rata split (unlike South32 which received demerger relief)," it says.
Concerns Reignited Over Peru Mining Outlook
Peru's decision not to grant additional approvals for some of Hochschild's mining operations is of concern for the broader mining industry, says Jefferies. Peru is the second-largest copper-producing country. While leftist President Pedro Castillo earlier expressed support for private investment in the country's mines, "the government is still looking to the mining industry to develop local infrastructure, especially in poor regions, and to operate 'for the benefit of local communities,'" Jefferies says. Mining taxes are likely to increase, at minimum, weighing on mining investment, the bank reckons. "In our coverage, Anglo American, Glencore, Freeport, MMG, BHP, Newmont, and Sierra have exposure to Peru and could be negatively impacted by rising political risk."
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